Bisq is the only true decentralized exchange platform
I’m a huge fan of Bisq because it’s the only true decentralized and censorship-resistant exchange platform without the need for registration, Know-Your-Customer verification (KYC) or intermediaries as it allows traders to buy and sell bitcoin for fiat either in person or using one of the many available bank transfer options, such as Revolut or N26.
I am not aware of any other platform presently capable of doing that. But there is more: Bisq is a so-called DAO, a digital, decentralized, autonomous organization which uses software sanctioning its governance. That means there is no central point of failure. There are of course other decentralized exchanges (DEX), but these are Ethereum-based platforms where bitcoin can only be bought/sold indirectly through so-called wrapped Bitcoin (WBTC), again requiring a 3rd party entity to exchange WBTC for BTC.
Long story short: Bisq is the one and only at this time and I’m connected to its peer-to-peer network (P2P) every day as an offer maker to broadcast my trade offers.
Bisq has a relatively slow rate of adoption and low liquidity
What concerns me is the low rate of adoption and liquidity. I checked the buy and sell offer market this morning. The number of buy and sell offers adds up to only 276 (Buy) + 189 (Sell) = 465. That’s a relatively low number considering that it’s the number of all open orders across all countries and across all fiat payment methods.
You need to understand though that the number of open orders is based on all network nodes currently connected to the Bisq-P2P network. Some offer makers shut down their desktop computers regularly, or every now and then. The number of these offline offer makers is not included in the number above. Once these offer makers come online again – or reconnect to the Bisq-P2P network to be precise – their buy and sell offers will get broadcast again to the Bisq network.
It’s your best guess what the total number would be if all network nodes were connected at the same time. I would be surprised if that number would surpass 1000. 1000 is still a relatively low number compared to the massive volume that online exchanges such as Binance and Coinbase enjoy. And let’s not forget that this is the number including all countries and payment methods.
The problem with slow adoption
The problem with low adoption is that an offer maker might not see his order(s) get filled for an extended period of time. If you are an offer maker you may become impatient and turn away from the platform altogether. It’s important to remember that every order is tied to a payment method. That means, an offer maker needs to find an offer taker not only willing to pay/receive the offer price but to accept the offer maker’s payment method. In order for a trade to take place, there needs to be coincidence in price and payment method.
The reasons for slow adoption
Here are the possible reasons I can think of that adoption rate is fairly slow.
- Lack of awareness. Most people interested in buying bitcoin know they can do that through online exchanges, but hardly anyone has ever heard of Bisq. It is the purpose of this website to create more awareness of the Bisq platform.
- Steep learning curve. Let’s be honest. It’s easiest to register at an online exchange, buy bitcoin and have the exchange manage your funds.
Bisq requires you to install and configure the Bisq software client. And please note that it is a desktop software client, not a smartphone or tablet app. It requires you to protect your mnemonic phrase. Losing your mnemonic phrase may lead to a total loss of your funds. You need to place a trade or accept a trade offer. You must back up your Bisq-directory to be prepared in case your computer crashes. Before you can place or take an offer you need to fund your wallet in order to pay for security deposits, trade and transaction fees. In my opinion, this is one of the biggest hurdles to overcome. All these steps add to the complexity for newcomers. Again, I hope that my site is useful in educating anyone in the name of financial privacy.
As I said initially, I’m a huge fan of Bisq because it is unique in what it offers in terms of financial privacy through decentralization. I hope this project never fails because of a lack of adoption or funding and I encourage everyone to take a serious look at this ingenious project.
Your BKK Sledgehammer Messiah